Ps76 From , joined Dec 1969, posts, RR: Posted (11 months 2 weeks 6 days 9 hours ago) and read 1613 times:
Hi!
Apologies for talking about European tourist trains again:
Just came back from France and saw one again. I remember one time with my aunt in Antibes we were on one and I started thinking about how much money they made. This one carried 8 Euros/pounds I think for the roughly 30-40 minute trip. It typically carried maybe 30-40 people a trip. 8 times 35 is 280 Euros a trip taken in. Maybe 10 trips a day makes 2800Euros a day you're taking in! This one had one employee and I'm thinking once he's bought the train isn't that a hell of a lot of money to be making for driving people round and round! I know they're kinda seasonal but places like the South of France do pretty well all year round. Even if on average you only make 1500 Euros a day that's still 540,000 Euros in a year. You could be a millionaire in two years!
I must be doing some calculations wrong here or is this the World's biggest kept money-making secret!
vikkyvik From United States of America, joined Jul 2003, 8318 posts, RR: 28 Reply 2, posted (11 months 2 weeks 6 days 8 hours ago) and read 1557 times:
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Quoting Ps76 (Thread starter): Even if on average you only make 1500 Euros a day that's still 540,000 Euros in a year. You could be a millionaire in two years!
Aren't taxes quite high in Europe? At least compared to the US....
Quoting tz757300 (Reply 1): Gross Income must be nice. I bet Net Income sucks.
I have no idea if it sucks or not, but it's certainly going to look different from gross!
You have to factor in taxes, business expenses, retirement, a bunch of other stuff. I bet maintenance and gas and such are huge expenses. Then there are probably city licenses, etc....
"Two and a Half Men" was filmed in front of a live ostrich.
Klaus From Germany, joined Jul 2001, 20902 posts, RR: 55 Reply 3, posted (11 months 2 weeks 6 days 7 hours ago) and read 1524 times:
Tourism typically has very high, often just short peaks and very long, very low valleys in revenue.
You obviously only see such attractions when you're visiting them which may be just in peak season, but not when they still keep costing money and rake in far less money when they're half-empty or completely unused. Some of them can indeed be money machines, but some can just as well be money pits to be cross-subsidized by other venues.
rfields5421 From United States of America, joined Jul 2007, 6191 posts, RR: 25 Reply 4, posted (11 months 2 weeks 5 days 22 hours ago) and read 1337 times:
I would be very surprised if they were owned/ operated by one person, or even one family. And the license fees to the city, hotel, local tourism board must be huge.
The person operating/ driving probably is just an hourly employee, working only seasonally.
Yes such a train would gross a lot of money - but probably less than half your total figure due to seasonal fluctuations. And probably half the money would end up going to the tax man.
fr8mech From United States of America, joined Sep 2005, 4346 posts, RR: 12 Reply 5, posted (11 months 2 weeks 5 days 22 hours ago) and read 1329 times:
Remember a formula from your basic accounting class:
Profit = Revenue - Expenses
Expenses include, but are certainly not limited to:
-fuel
-marketing
-salary
-insurance
-maintenance
-fees (permits, license, business, operating, etc.)
-legal
-service on any loans taken to open the business or buy the train/bus
Then you have to factor in taxes, which in the United States, will typically come after the expenses are deducted from the revenue. Not sure how that works in the various EU countries.
I would also take your revenue number with a big grain of salt. You're assuming a consistent load factor plus 365 day service. 365 can be done, but that would indicate additional employees and additional trains to operate the tour.
Don't want to burst the bubble, but there is a lot more to running a business than taking in the money and providing the service.
NoUFO From Germany, joined Apr 2001, 7802 posts, RR: 13 Reply 9, posted (11 months 2 weeks 5 days 15 hours ago) and read 1187 times:
Quoting fr8mech (Reply 5): Then you have to factor in taxes, which in the United States, will typically come after the expenses are deducted from the revenue. Not sure how that works in the various EU countries.
The same of course. Okay, I can only speak for Germany, but I don't think for a second that there is a country that taxes your expenses (with the VAT a so-so exception).
I would guess that the license for driving tourists trains through a city gets auctioned to the highest bidder every xy year(s) so there won't be too many of them clogging up the roads. That alone would cost you dearly.
Ps76 From , joined Dec 1969, posts, RR: Reply 10, posted (11 months 2 weeks 5 days 15 hours ago) and read 1179 times:
Hi!
Many thanks for the replies. Has been pretty interesting and maybe the situation is not as rosy as I was thinking!
Quoting NoUFO (Reply 9): I would guess that the license for driving tourists trains through a city gets auctioned to the highest bidder every xy year(s) so there won't be too many of them clogging up the roads. That alone would cost you dearly.
Very true. I can only imagine in a place like Antibes or Nice in the South of France this would be a pretty competitive auction.
Klaus From Germany, joined Jul 2001, 20902 posts, RR: 55 Reply 11, posted (11 months 2 weeks 5 days 14 hours ago) and read 1159 times:
Quoting NoUFO (Reply 9): I can only speak for Germany, but I don't think for a second that there is a country that taxes your expenses (with the VAT a so-so exception).
No, VAT is no exception either. Expenses are deducted from it as well; You even get the net difference from the state when you temporarily have more expenses than income ("Vorsteuer").
Of course that applies only to businesses. Comsumers will always have to pay VAT in full with no deductions, with the shop effectively handing it back along the supply chain, so it is only paid once in effect., with every business paying its bit to the state according to its portion of the net revenue.
rfields5421 From United States of America, joined Jul 2007, 6191 posts, RR: 25 Reply 12, posted (11 months 2 weeks 5 days 10 hours ago) and read 1085 times:
Such a cash business is going to pay a lot of taxes. Something so visible is going to be audited and tracked quite closely.
One reason is that the concession contract might have thresholds of payments at certain ridership levels.
Another reason is protection of the operator. Auditors might say the operator owes taxes based on an audit during a very busy day - so keeping good records protects such a business against overly optimistic estimates of income by auditors.
NoUFO From Germany, joined Apr 2001, 7802 posts, RR: 13 Reply 14, posted (11 months 2 weeks 3 days 16 hours ago) and read 882 times:
Quoting Klaus (Reply 11): No, VAT is no exception either. Expenses are deducted from it as well; You even get the net difference from the state when you temporarily have more expenses than income ("Vorsteuer").
Well, I know, after all I had been a freelancer for more than ten years. Hence I didn't say VAT was actually an exception. But being a consumer tax it taxes expenses made by consumers (duh) and there is no deduction. Fr8mech was wondering if it was possible for countries in Europe to demand taxes before expenses were deduced. The closest that would come to such an absurd tax would be the VAT (albeit not really) - in Europe as well as in the U.S.A.
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